Fundamentals of Financial Accounting
5th Edition
ISBN: 9780078025914
Author: Fred Phillips Associate Professor, Robert Libby, Patricia Libby
Publisher: McGraw-Hill Education
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Question
Chapter 4, Problem 4.19E
a.
To determine
To prepare: A four part table by using the given information. Items (a)-(f) are independent of one another.
a.
Expert Solution
Explanation of Solution
The four part table is shown below:
| (1) | On January 22, 2015, MSM received $24,000 cash from customers for one–year subscriptions to the magazine for February 2015 – January 2016. | ||||||||||
| (2) | Assets | = | Liabilities | + | |||||||
| Cash +$24,000 |
Unearned Revenue +$24,000 |
||||||||||
| (3) | Account Names | Debit ($) | Credit ($) | ||||||||
| Cash (+A) | 24,000 | ||||||||||
| Unearned Revenue (+R, +SE) | 24,000 | ||||||||||
| (To record the unearned revenue) | |||||||||||
| (4) | Cash account | Unearned Revenue account | |||||||||
| $24,000 | $24,000 | ||||||||||
b.
To determine
To prepare: A four part table by using the given information. Items (a)-(f) are independent of one another.
b.
Expert Solution
Explanation of Solution
The four part table is shown below:
| (1) | Company MSM received Utilities services on account at a cost of $3,000. | ||||||||||
| (2) | Assets | = | Liabilities | + | Stockholders’ Equity | ||||||
|
Accounts payable +$3,000 |
Utilities expense (+E) -$3,000 | ||||||||||
| (3) | Account Names | Debit ($) | Credit ($) | ||||||||
| Utilities expense(+E, -SE) | 3,000 | ||||||||||
| Accounts payable (+L) | 3,000 | ||||||||||
| (To record the utilities expense) | |||||||||||
| (4) | Accounts payable account | Utilities expense account | |||||||||
| $3,000 | $3,000 | ||||||||||
c.
To determine
To prepare: A four part table by using the given information. Items (a)-(f) are independent of one another.
c.
Expert Solution
Explanation of Solution
The four part table is shown below:
| (1) | Company MSM provided $2,000 of subscriptions for which it had been received the payment previously. | ||||||||||
| (2) | Assets | = | Liabilities | + | Stockholders’ Equity | ||||||
|
Unearned Revenue -$2,000 |
Subscription revenue (+R) +$2,000 | ||||||||||
| (3) | Account Names | Debit ($) | Credit ($) | ||||||||
| Unearned revenue (-L) | 2,000 | ||||||||||
| Subscription Revenue (+R, +SE) | 2,000 | ||||||||||
| (To record the subscription revenue) | |||||||||||
| (4) | Unearned Revenue account | Subscription revenue account | |||||||||
| $2,000 | $2,000 | ||||||||||
d.
To determine
To prepare: A four part table by using the given information. Items (a)-(f) are independent of one another.
d.
Expert Solution
Explanation of Solution
The four part table is shown below:
| (1) | On March 31, 2015, Company MSM recorded an |
||||||||||||
| (2) | Assets | = | Liabilities | + | Stockholders’ Equity | ||||||||
| Accumulated | Depreciation | ||||||||||||
| Depreciation–Equipment (+xA) –$10,000 | Expense (+E) –$10,000 | ||||||||||||
| (3) | Account Names | Debit ($) | Credit ($) | ||||||||||
| Depreciation Expense (+E, –SE) | 10,000 | ||||||||||||
| |
10,000 | ||||||||||||
| (To record accumulated depreciation) | |||||||||||||
| (4) | Accumulated Depreciation–Equipment account | Depreciation Expense account | |||||||||||
| $10,000 | $10,000 | ||||||||||||
e.
To determine
To prepare: A four part table by using the given information. Items (a)-(f) are independent of one another.
e.
Expert Solution
Explanation of Solution
The four part table is shown below:
| (1) | On April 1, Company MSM paid $5,000 rent in advance of obtaining its benefits. | ||||||||||
| (2) | Assets | = | Liabilities | + | Stockholders’ Equity | ||||||
| Cash –$5,000 | |||||||||||
| Prepaid Rent +$5,000 | |||||||||||
| (3) | Account Names | Debit ($) | Credit($) | ||||||||
| Prepaid Rent (+A) | 5,000 | ||||||||||
| Cash (–A) | 5,000 | ||||||||||
| (To record prepaid rent) | |||||||||||
| (4) | Cash account | Prepaid Rent account | |||||||||
| $5,000 | $5,000 | ||||||||||
f.
To determine
To prepare: A four part table by using the given information. Items (a)-(f) are independent of one another.
f.
Expert Solution
Explanation of Solution
The four part table is shown below:
| (1) | On April 30, 2015, Company MSM billed customers for $10,000 of advertising services provided on account. | |||||||||
| (2) | Assets | = | Liabilities | + | Stockholders’ Equity | |||||
| Accounts | Service | |||||||||
| Receivable +$10,000 | Revenue (+R) +$10,000 | |||||||||
| (3) | Account Names | Debit ($) | Credit ($) | |||||||
| Accounts Receivable (+A) | 10,000 | |||||||||
| Service Revenue (+R, +SE) | 10,000 | |||||||||
| (To record providing services on account) | ||||||||||
| (4) | Accounts Receivable account | Service Revenue account | ||||||||
| $10,000 | $10,000 | |||||||||
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Chapter 4 Solutions
Fundamentals of Financial Accounting
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